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2016 (1) TMI 1117 - AT - Income TaxTransfer pricing adjustment - selection of comparables - Held that:- The conceptualization of the services is primarily done by Ameriprise US which collects data and sends the same in raw form to the assessee or the other relevant data is procured by the assessee directly from the sources referred by the Ameriprise US. The assessee compiles such raw data in desired format/sequence and undertakes processes, such as, merging of data, sequencing, etc. This is an in-house function performed by the assessee for further actions to be taken by Ameriprise US. Thus the assessee is involved in providing back office support services to Ameriprise US without any direct involvement in the conduct of business of Ameriprise US. Accentia Technologies Ltd., i-Gate Global Solutions Sdn. Bhd. directed to be excluded from the final list of comparables due to this extra-ordinary financial event. Infosys BPO - we find from the Annual report of this company, that there was acquisition by this company of McCamish Systems LLC. Acquisition of McCamish Systems LLC during the year, being an extraordinary financial event, renders it incomparable. Following the reasons taken note of above, we order for the elimination of this company from the final set of comparables. TCS E-Serve International Ltd. and TCS e-Serve Ltd.the entity level figures render this company as unfit for comparison. Therefore, we order for the removal of this company from the final set of comparables. eClerx Services Limited excluded from the final set of comparables. R. Systems (Seg.) - We note that in the immediately preceding year, this Company was considered by Coordinate Bench of Tribunal. It was directed that if the contention of the assessee is correct, that the relevant data for the concerned financial year can be deduced from the information available from their annual reports, then, there can be no objection to the inclusion of these companies in the list of comparables with the adjusted data for the relevant financial year itself. Respectfully following the reasoning of Coordinate Bench in immediately preceding year, we set aside the impugned order and remit the matter to the file of TPO/AO for examining this aspect of the matter. CG-VAK Software and Exports Ltd. (Seg.) - at a company cannot be excluded from the list of comparables on the ground of its low turnover. In principle, we direct the inclusion of the relevant segment of this company in the list of comparables. The TPO is directed to include the operating profit/operating costs of the ITES segment of this company in the list of comparables, after due verification of the necessary figures for determination of the operating profit margin etc. Inter-company Receivables - Held that:- No question of charging any interest as a separate transfer pricing adjustment.
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